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Study: College students would pay for Napster

About one in three students would be willing to pay for an online music subscription service such as the one proposed by the file-swapping company, a report says.

About one in three students would be willing to pay for an online music subscription service such as the one proposed by file-swapping company Napster, according to a new report.

The study, released Monday by Mercer Management Consulting and the National Association of Recording Merchandisers, polled 1,800 college students on music listening habits. It found that of the 394 songs stored as MP3 files on the average respondent's computer, 79 percent had been downloaded. Only 62 percent of those came from Napster, showing that students were also using alternative file-swapping services such as Gnutella. In addition, 61 percent of the students said they had never "ripped," or copied, a CD.

The study comes as online music evolves from a free service to a paid one. Last week, Warner Music Group, EMI Recorded Music, BMG Entertainment, and RealNetworks said they would create a new company, MusicNet, to develop a music subscription service. In addition, MTVi Group and infrastructure company RioPort teamed last week to offer paid song downloads through MTVi's Web sites.

Mercer analyst Matthew Bender said record companies likely will need to consider adding other features such as advanced concert tickets or rare songs to any download subscription service.

"It's going to be tough for somebody to have just a basic subscription service because there's always going to be some sort of way to get the music for free," he said. "The challenge for the record companies is they're going to need to create some sort of value besides just the music to get people to pay."

Researchers found that 26 percent of the students download rare, live or out-of-print recordings; 50 percent download songs considered alternative, mainstream or older works.

In addition, only about half of the college students surveyed had a stereo system, but nearly 98 percent had a personal computer. Most of those computers had components such as CD-ROM drives, stereo speakers, and broadband Internet connections to take advantage of music services. The study revealed that students were not necessarily downloading music that they already owned; many were creating a separate collection on a computer.

The study also found that at least half of students that were interviewed had been to a party where the DJ did not bring a stereo but rather a computer to play the music for the party.

"It's definitely a sign of the times," Bender said. "The computer is kind of taking over to what people are using for their multimedia, their movies, their music, and whatnot."